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The Impact of Interest Rate Fluctuation on Islamic Bank Profitability in Malaysia<br />

Nurayuni Liyana Binti Shahru<br />

Supervisor: Dr. Siti Nurain Binti Muhmad<br />

Bachelor of Accounting<br />

School of Maritime Business and Management<br />

Islamic bank profitability is closely related to the growth of the economy and financial<br />

stability for the nation. However, certain issues such as interest rates fluctuation making<br />

it more complex to achieve the highest profitability of Islamic bank. Thus, this study tend<br />

to identify the impact of interest rate fluctuation on Islamic bank profitability in Malaysia.<br />

This study employ the secondary data which consist the variable form bank specific<br />

determinants (internal factors) and macroeconomic determinants (external factors). The<br />

analysis of data is taken from the sample of interest rate from Bank Negara Malaysia for<br />

year 2015 until 2017. It is theoretically expected that the Islamic banks in Malaysia are<br />

visibly influenced by interest rates and could identify the other factor that influence the<br />

Islamic bank profitability. Additionally, this study will add to the existing literature on the<br />

latest topic of Islamic bank profitability so that the practitioner could refer for the latest<br />

issues.<br />

1517 | UMT UNDERGRADUATE RESEARCH DAY 2018

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